A subcontractor hired to work on renovations of a US Embassy in Cyprus is suing Williams Building Company (WBC) for $2,248,006.21 after the US State Department canceled WBC’s contract on the project. WBC has been accused of allegedly making slow payments and refusing to pay some invoices.
Pyramis LTD’s claim is the latest Miller Act claim coming from work on a US embassy project — there have been similar issues with projects based in Honduras and Ghana with general contractor BL Harbert over alleged issues with workers’ compensation insurance and unpaid salaries.
According to claim documents, Pyramis was hired in 2019 as a subcontractor of WBC and as a representative to the firm in Cyprus. Pyramis’ work on the project allegedly experienced significant delays, because Pyramis needed to wait for the US State Department as well as WBC to approve of design drawings, plans, and specifications for the project.
Delay notices and proposed change orders went unreturned from WBC, and Pyramis was forced to self-finance the project in late 2020. Soon afterward in July 2021, workers stopped showing up because of these finance issues and the State Department soon canceled WBC’s contract in August 2021.
Williams Building Company is currently listed on the US State Department’s list of general construction contractors on overseas projects.
In Honduras, 900 workers recently went on strike to protest illegal hourly wage contracts that don’t protect them from injury and fine them if they miss a day of work. Additionally, in Namibia, there are reports of salary cuts and delays as well as unpaid overtime over a US Embassy project. These two projects have both been overseen by BL Harbert.
The aforementioned embassy projects employ thousands of workers while also providing GDP-boosting revenue to the countries the projects are based in. BL Harbert is not only working on US Embassy projects in Ghana and Namibia, but in Mexico City and Kosovo as well.
The Miller Act helps a subcontractor receive payment for labor and materials provided on a United States federal property. Any contract that’s worth more than $100,000 requires the general contractor to have a payment bond as well as a performance bond on the project.
The payment bond is a measure used to guarantee payment to the subcontractor for their labor and their materials. The performance bond is a deal between the GC and the federal government that the GC will finish the contract according to the contract. The Miller Act only applies to first-tier subcontractors and suppliers, as well as second-tier subcontractors.
Although Pyramis is a contractor located overseas, they will qualify for a Miller Act claim as the US embassy in Cyprus is a US federal property, and the docket for their case includes a copy of the payment bond between WBC and the federal government.
According to construction attorney Joseph Katz at Katz Law, “If a Miller Act bond was provided then the location of the work itself does not matter, other than finding the right US District Court in which to file the lawsuit.”
“Be advised, however, that the Miller Act allows for a waiver of the bond requirement for work overseas in the event providing the bond is “impractical” — so your first step would be to inquire as to whether there is a Miller Act bond for this work,” Katz said.
Any subcontractor who seeks a Miller Act claim must perform the following steps to qualify:
- Deliver a notice to the Prime Contractor
- Follow up with the surety company
- Provide backup and sworn claim form to surety
- Get paid or move forward with your case
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